Judgment

AHMADI, J :- Is a barge a boat? The answer to this question will determine the challenge to constitutional validity of the tax levied on a barges under the Goa, Daman and Diu Barge Tax Act, 1973 (hereinafter called the Act). It is contended that the State Legislature was competent to enact the Act by virtue of the power conferred by Entry 58 in List 11 of the VIIth Schedule to the Constitution of India which permits levy of taxes on animals and boats. If barges are not boats, the Act will lose the cover provided by the said entry and will be rendered unconstitutional.

2. The Act, as the Preamble shows, was enacted to impose a tax on barges in the Union Territory of Goa, Daman and Diu and for matters connected therewith and was brought into force with effect from 1st March, 1971. Barge according to S. 2(1) means every description of water craft mechanically propelled and which is used or is capable of being used as means of transport of minerals. S. 3 which is the charging section provides that there shall be levied and collected on all barges used or kept for use in the Union Territory, a tax at the rates fixed by the Government, by Notification in the Official Gazette, but not exceeding the maximum rates specified in the Schedule to the Act. The Schedule to the Act reads as under:

"SCHEDULE

(Section 3)

Capacity of Barge Maximum annual rate per tonne

Less than 100 tonnes Rs. 3.50

100 tonnes and less than 200 tonnes Rs. 5.00

200 tonnes and less than 350 tonnes Rs. 6.00

350 tonnes and above Rs. 7.50

Note: When tax is not paid for the whole year at a time, but is paid for one or more quarters at a time, the tax so payable for each quarter shall be an amount equal to one-fourth of the annual tax plus ten per cent of that amount."

Section 19 empowers the Government to make rules to carry out the purposes of the Act. In exercise of the said power the Government by a notification framed rules called the Goa, Daman and Diu Barge Tax Rules, 1975. R. 6 lays down that every owner or the person having possession or control of a barge in the Union Territory shall pay to the Government a tax at the rates specified in the table below:

TABLE

Capacity of Barge Rate of tax payable per annum per tonne

Less than 100 tonnes Rs. 3.50 p.

100 tonnes and less than 200 tonnes Rs. 5.00 p.

200 tonnes and less than 350 tonnes Rs. 6.00 p.

350 tonnes and above Rs. 7.50 p.

The rates which have been specified are the same as specified in the Schedule to the Act. For the purpose of levy of tax under R. 7, the Taxation Authority may require the barge to be calibrated i.e. identify the carrying capacity with reference to its structural strength, reserve buoyancy and safe working height above water level. R. 8 lays down the mode of payment. R. 9 provides for the issue of tax licence and Tax Token and R. 10 provides for levy of penalty for failure to pay the tax. R. 11 empowers the seizure and detention of any barge with respect to which the tax is due under the Act, until the tax due in respect of the barge is paid. Provision is also made for refund of tax in certain circumstances. It will thus be seen from the relevant provisions of the Act and the Rules that the State Government has levied a tax on all barges used or kept for use in the Union Territory of Goa, Daman and Diu. The Government contends that since barges are boats, the State Legislature was competent to levy and collect a tax on barges under Entry 58 in List II of the Vllth Schedule to the Constitution.

3. Counsel for the appellants contended that the word boat cannot include a mechanically propelled vessel and since the definition of a barge in S. 2(1) of the Act means a mechanically propelled water craft used or capable of being used as a means of transport of minerals, it cannot be termed as a boat to attract the legislative power conferred by Entry 58 in List II of the VIIth Schedule and hence the impugned legislation is clearly incompetent. Reference was also made to the definitions of ship an